Overview of UK Automotive...

THE SOCIETY OF MOTOR MANUFACTURERS AND TRADERS LIMITED SMMT, the ‘S’ symbol and the ‘Driving the motor

industry’ brandline are trademarks of SMMT Ltd

Overview of UK Automotive Industry

Yung Tran

Head of Member Services

THE SOCIETY OF MOTOR MANUFACTURERS AND TRADERS LIMITED PAGE 2

THE UK AUTOMOTIVE SECTOR

• UK automotive sector makes 1.5 million cars and commercial vehicles and over 2 million engines annually

• Automotive is vital to the UK economy

– Around £55 billion turnover

– £12 billion value added

– Over 700,000 jobs dependent on automotive

– More than 11% of total UK exports

– Invests £1.3 billion each year R&D

• UK is home to 7 volume car manufacturers, 8 commercial vehicle, 11 bus & coach, more than 10 major premium & sports vehicle manufacturers and ca. 2,350 component manufacturers


Current state of the market

UK new car registrations

1,800,000

1,900,000

2,000,000

2,100,000

2,200,000

2,300,000

2,400,000

2,500,000

2007 2008 2009 2010 2011 2012 2013

Actual Forecast, at July '12

Pre-recession

2.4m

2013 forecast

2.015m

2012 results

2.045m



UK automotive manufacturing

0

500,000

1,000,000

1,500,000

2,000,000

2,500,000

1970 1980 1990 2000 2010

Manufacturingoutput: 1970-2011

Manufacturingforecast: 2012-2016

2016 target

2.1m

1972 peak

1.92m

2012 results

1.58m



UK exports at all time high!

600,000

700,000

800,000

900,000

1,000,000

1,100,000

1,200,000

1,300,000

1,400,000

1,500,000

1,600,000

2007 2008 2009 2010 2011 2012

UK

car

man

ufa

ctu

rin

g

Total Export

> 1.2m

exported in

2012


EU Car Registrations

Source ACEA

Overall 8.2% contraction in EU markets during 2012


The economic vulnerability of key export markets is

limited when compared with other EU countries

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

UK Germany Spain France Italy Poland Hungary Czech Republic

European Union Asia North America Other

Source: UN Comtrade data, KPMG analysis

Final destination of exports, by value (Euros), 2011

Only around 45% of the UK’s exports are

to EU countries as opposed to 70% to

90% for other European countries


Vauxhall: £125m

Ellesmere Port

MINI: £250m

Production triangle

Nissan: £252m

New Invitation

and hatchback

Jaguar Land Rover:

£355m

New engine plant


£6bn investment

• 14,000 direct new jobs; thousands more in supply chain

Toyota: £100m

New hatchback



Supply Chain UK investment

• TRW investment of £15m at facility in Sunderland

• Nifco plan to move to larger facility creating 170 new jobs

• GKN £12m to increase capacity at Birmingham and Telford

• IAC £3.5m investment at Solihull and Scunthorpe

• Brose £7m expansion of manufacturing site

• Futaba Industrial UK, upto 100 new jobs in Derbyshire

• Calsonic Kansei £15.3m investment in manufacturing facility

• Unipress 350 new jobs at Wearside plant


Investment in UK

KPMG Report – Sept 2012

Highlights

• Massive investment by OEMs

(£6bn)

• Production forecast to increase

significantly >2m by 2016

• Major Opportunities for UK

suppliers (£3bn)

• Strong product mix with high %

exports going outside EU

• FX, labour cost, corporation tax &

govt support all supportive of UK

THE SOCIETY OF MOTOR MANUFACTURERS AND TRADERS LIMITED SMMT, the ‘S’ symbol and the ‘Driving the motor

industry’ brandline are trademarks of SMMT Ltd

Supply Chain Activities

Yung Tran

Head of Member Services

Matthias Holweg

with

Yung Tran

Philip Davies

Stephan Schramm

THE UK SOURCING ROADMAP

CREATING AND SUSTAINING SUPPLY CHAIN

CAPABILITIES IN THE UK AUTOMOTIVE INDUSTRY

2010 2011 2012 2013 2015 2014

Alternative powertrain parts entering

full-scale production

Support LCV demand

UK Sourcing Roadmap

Interior & exterior

Body & powertrain

Electrics & electronics

Identify Top-10

suppliers

Survey point #1: A. OEMs’ UK sourcing: £7.4bn B. GVA in UK supply chain: £4.8bn

Survey point #2: A. Increase in OEMs’ UK sourcing? B. Increase in GVA in UK supply chain?

Sho

rt-t

erm

o

pp

ort

un

itie

s th

rou

gh m

atch

ed

nee

ds

Cri

tica

l su

pp

ort

Med

ium

- to

lo

ng-

tem

p

ote

nti

al fo

r LC

V p

arts

Support R&D at UK suppliers

Target international suppliers

A. Shop-floor competitiveness

B. Total supply chain cost modelling

C. Finance to sustain and grow business

* *

* Interface area with Technology Group

SOCIETY OF MOTOR MANUFACTURERS AND TRADERS LIMITED PAGE 14

Supply Chain Report 2012

• The confidential survey was

conducted by Cambridge

University, with the results

analysed by BIS

• The report was published in

August 2012

• Identified £3bn opportunities

UK Automotive Opportunities

Support & Advice MAS, LEP, UKTI, SEMTA NAA,TSB, ESPRC, UKCES

Automotive Council SMMT

Industry Engagement and Support Organisations

Working together to maximise on the opportunities


April 2011 event: • 200 People participated • 30 Buyers from 20 companies including Aston Martin, BMW, Ford, GM, Honda, JLR, Nissan

• Around 90 Suppliers

• Over 200 1-2-1 meetings

• 3 regional events 31 Oct Melton Mowbray 8 Nov Chester 15 Nov Bridgend

SMMT ‘Meet the Buyer’ events


Meet the Buyer event

3rd July 2012, Cranmore Park, West Midlands

Buying Organisations:

• Aston Martin

• BMW

• Ford Europe

• General Motors

• Nissan

• Tata Motors

• Bentley

• JTEKT • Kostal UK • Mobis Parts • Koito Europe • NSK Europe • Sanoh Manufacturing • Scorpion Automotive • Aisin Europe • Bosch • CAB Automotive • Calsonic Kansei • Faurecia • Futaba Tenneco • Futaba Tenneco • Grupo Antolin • IAC Group


Meet the Buyer event

3rd July 2012, Cranmore Park, West Midlands

Results:

• Over 200 people participated representing 140 organisations

• Around 330 1-2-1 meetings took place on the day.

• 230 Pre-scheduled 1-2-1 meetings

• 294 additional meeting requests made on the day

• 103 were successfully fulfilled

• Approx 67% positive meeting outcomes (of known)

2013 Meet the Buyer Event confirmed for 23 May at Cranmore Park


Access To Finance

Report by Smith Institute

Published in June 2012, the report highlights :

• 5 main barriers and

• 5 corresponding recommendations:


Access To Finance

Report by Smith Institute

Barriers:

1. Relationship between banks and auto sector and lack of

understanding.

2. Finance for Tooling is a particular problem for many.

Recommendations:

1. Step change in the engagement of UK finance sector with

automotive sector is needed.

2. A combined finance and automotive ‘Tooling for Growth’

taskforce to identify innovative solutions.


Meet the Funder event

21 November 2012, Cranmore Park, West Midlands

Funding & Support Organisations:

• Santander

• Barclays

• RBS

• Lloyds

• HSBC

• Lombard

• NatWest

• Yorkshire Bank

• Clydesdale Bank

• Business Growth Fund

• TNUI Capital

• Pemberton Capital

• Panoramic Growth Equity

• FW Capital

• Blue Sky Corporate Finance

• MAS

• Derby City Council

• North West Auto Alliance

• Northamptonshire Enterprise Partnership

• Talent Retention Solution


Meet the Funder event

21 November 2012 July, Cranmore Park, West Midlands

Results:

• Around 150 people participated representing 90 organisations

• Over 100 1-2-1 meetings on the day

• Presentations from KPMG, JLR and BBA during the morning

• Overall the results were very positive

• RBS – ‘Overall I think the SMMT are doing a very good job of this…useful dialogue

with both members of supply chain and OEMs’

• CMA Metal Forming – The presentations were well pitched with good positive messages’

• Formula Plastics – the opportunity to have meaningful discussions with 5 different funding providers’

• Productiv – ‘very good day, it exceeded my expectations’

• NSK – ‘No improvement necessary. This was a well organised event which proved informative and productive’.

• Blue sky corporate finance – the people I met had a clear view of what they needed and why…indicates that the pre event marketing was very good – well done’

• Ludgate finance – ‘…the chance to meet very good quality potential clients’


SMMT Open Forum

Date: 21 March 2013

Venue: Heart of England Conference Centre, West Midlands

Time: 9.30am

Agenda:

• Automotive Council Technology Group Update

• Automotive Council Supply Chain Group Update

• Industry presentations from General Motors, Nissan and Caparo

See www.smmt.co.uk for more details

http://www.smmt.co.uk/


SMMT International Events 2013

Export Opportunities for UK suppliers

• Mexico: New Business Opportunities Seminar

13 Feb, SMMT London

• Automechanika Istanbul, 11-14 Apr 2013

• Autopromotec, Bologna, 22 – 26 May 2013

• Global Automotive Component Supplier Engine Expo 4 – 6 Jun 2013

• MIMS (Moscow International Motor Show 28 – 31 Aug 2013

• EVS27, Barcelona 17 – 20 Nov 2013

Society of Motor Manufacturers and Traders Limited

71 Great Peter Street, London SW1P 2BN

www.smmt.co.uk

THE SOCIETY OF MOTOR MANUFACTURERS AND TRADERS LIMITED

Thank You

Overview of UK Automotive...

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